Eye on the News

Nicole Gelinas

Spare Some Electricity, Mr. Mayor?

Notoo boring for Bloomberg.

25 July 2006

Mayor Bloomberg has had many ambitious ideas during his first four and a half years in office: bringing the Olympics to New York, a football stadium to Manhattans West Side, and a basketball stadium to Brooklyn are just three. The mayor claims all of his central planning is necessary to spur the economic growth that creates jobs. But the mayor should drop the spectacular projects and concentrate on something far less headline-grabbing: maintaining and improving the plain old infrastructuremuch of it underground and invisiblethat has supported Gothams natural growth over the past decade but now strains beneath it.

Take electricityessential, but far less interesting than holding press conferences to show off blueprints of a glassed-in football stadium on the Hudson River, for example. So Bloomberg ignores it.

This neglect goes unnoticed when the electricity is actually on. But beginning early last week, for 100,000 residents and business owners in northwest Queens, it wasnt (and, for several thousand, at press time, it still isnt).

Until Queens citizens and politicians fury reached a crescendo by Friday, Bloomberg didnt even seem to think it was his job to worry much about the blackout. He got annoyed at reporters who badgered him about it last Wednesday, and said testily that he would visit Queens only if he could fit it into his schedule. As late as Saturday, though hed finally made it to Queens, he described borough residents weeklong ordeal as a mere inconvenience.

But the problems that have plagued northwest Queens for a week now were foreseeable. Theyre probably the same problems that caused a Washington Heights blackout seven years ago: record heat-wave electricity usage overwhelmed underground feeder cables, because theyre old and simply inadequate to perform whats necessary on a hot summer day to meet New Yorks insatiably growing demand for power.

Over the past 10 years, Con Ed says, electricity demand in Gotham has risen 20 percent. Its no mystery why: over that time period, New York developers have built 160,000 new homesequivalent to a Boston-sized city.

While most media attention centers on the need to build new power plants to meet this demand, independent power producers do a reasonable job on this task themselves. During the Bloomberg years, competing power generation companies have quietly built, or begun work on, five new plants to serve New York City, enough to meet about two-thirds of projected demand through the end of the decade.

Why? Because competition works: despite permitting and environmental obstacles that politicians and community activists have thrown up, power generators want to build in New York, since they know they can make money here.

But competition doesnt work at Con Ed. Since 1990s-era deregulation, Con Ed produces little power itself. Instead, it buys the power from the independent generators and distributes it to New Yorkers. Con Ed, as a monopoly, faces none of the competitive pressures that the independent generators face. So it must operate under close supervision by New York City and State to ensure that its doing a good job.

Con Ed, for example, isnt free to set its own power ratesNew York State sets them. And it isnt free to earn unlimited profits, as most companies can: over a certain threshold, New York demands that some extra profits be returned to ratepayers.

Most important, Con Ed must depend on state officials to allow it to pass through to its customers the cost of investments that it makes in its underground transmission network. The company said earlier this year that it would spend $1.2 billion this year, and $5.3 billion over three years, to improve its transmission and distribution networks (some of that money goes to counties outside New York City). But clearly, it wasnt enough, or fast enough.

Because Con Ed doesnt face competitive pressures to do whats best for New York City, its the mayor who must ensure that the company does so, or New Yorks growth suffers. Due to the Queens blackout, one of the boroughs largest employers, Citigroup, lacked a reliable supply of electricity. Next time, it might be Midtown Manhattan without power for a week. Faced with such a crisis, what would a responsible CEO conclude about his companys future in Gotham?

Electricity isnt the only seam slowly splitting in New York. Consider the subways. Last year, subway ridership was the highest in 50 years, up 33 percent since 1996. But service hasnt increased enough to meet the demand.

Indeed, on some of the citys busiest lines, like the East Side ones that run from the Bronx down through Manhattan and into Brooklyn, service conditions are intolerable. Day after day, people wait 10-deep simply to get on the escalator at some Manhattan East Side stops, and they wait dozens deep to exit stations through the dangerous, unmanned high-entry, high-exit turnstiles that the MTA has unintelligently installed. On the L-line in Brooklyn, a borough thats seen more than 30,000 new apartments go up in a decade, one acquaintance tells me that she sees crowding conditions worsen every week as ever-more people start new commutes from all of those new units.

New York badly needs new subway lines and more express trains, and it likely needs a massive upgrade to its electrical infrastructure. Its these shortfalls in infrastructure that eventually will retard Gothams growthnot the lack of a basketball stadium in Brooklyn.